Publisher’s Note: Tomorrow marks the opening of the Port Phillip Publishing investment conference, The Great Repression. In a world first for Port Phillip Publishing, we will livestream publisher Kris Sayce’s opening remarks on Facebook. To follow the event live, go to the Markets and Money Facebook page at 9:45am AEDT tomorrow morning. You’ll find Markets and Money Facebook page here.
Have you ever tried playing golf? My guess is that you might have. According to the Australian Golf Industry Council in 2015, 2.10 million Australians picked up a golf club to play or practice.
Of those, 1.15 million played a full round of golf.
The numbers stack up pretty close with Aussie Rules football. The AFL puts national participation at around 1.2 million annually.
In other words, when it comes to participation, golf is as popular as footy.
It’s a bloody hard sport golf. Think about it. The aim is to hit a small white ball into a cup dug in the ground. The ball is only 4.27 centimetres in diameter. The hole is only 10.8 centimetres in diameter. And the distance you need to get it is around half a kilometre away.
Also, you only have five shots to do it. After that, you repeat the same thing another 17 times. Add in a bunch of things to make it even harder, such as sand, trees, jungle-like grass and, of course, man-made lakes.
When it’s put to you like that…you can appreciate what a bonkers game golf really is!
Every time I play, I question why the heck I play at all.
But for all the lows in a game, the highs can be incredible. When you’re on fire, the reward is addictive. It can give you such a buzz.
The thing is that, in every round, you inevitably strike some balls so perfectly that you think, ‘I could go pro.’ Often, you’ll have special moments that stay with you forever.
I’ve had a couple over time.
The most memorable was The National’s Ocean Course down at Cape Schanck. Hole 7, Par 5. Cranked the driver sweetly down the fairway avoiding a bunker. Creamed the second shot, too. Left me about 120 metres short of the green.
I hit my 9-iron with some force. I pulled it out of the bag, and was on the putting green in three strokes. I was close to the pin. But far enough away to warrant some pressure. It might not get much better than this for the rest of the day.
The nerves started kicking in. I was shooting for a birdie on one of the world’s best golf courses. I’m no pro mind you. I don’t have a registered handicap, but would probably play off about 22. This was a big deal.
The little voice inside said: It’s OK if you miss the putt. A par on a par five is still good. And the other little voice was saying: Shut up you fool. Go for glory. You got this.
Accept the OK reward? Or go for it? Go for the big one, the once in a lifetime shot? Easy answer.
No risk, no reward. That’s how I play my golf. So I lined up my putt and went for it. Low and behold, it dropped, and the birdie stood.
Barely got near it for the rest of the game. But that one moment of glory was enough to wash away any bogeys (or worse) for the rest of the day — for the rest of the year.
Back the big guy or the little guy?
Yesterday I saw a picture of golf legend Gary Player. He was on course with the former NBA star Yao Ming.
It’s one of the greatest sports photos I think I’ve ever seen.
Click to enlarge
While Yao Ming was handy on the basketball court, his skills certainly don’t translate to golf. Let’s just say that, on the golf course, bigger certainly isn’t better. Gary Player on the other hand…
Well, if we’re talking about Gary Player, the best things come in small packages. Player, now 80 years old, is probably still one of the fittest people in golf. He was the first golfer to bring the idea of fitness to the game. His reasoning was simple: To be the best, you’ve got to physically be the best you can be.
Speaking to ESPN, Player said:
‘Looking back on the attitudes of golfers toward exercise, I am very proud to be the first to have helped changed their mindset,
‘Golfers were not really thought of as athletes even just a few decades ago. Now, they train like athletes do in other sports like rugby. Tiger Woods and now Rory McIlroy are great ambassadors for promoting fitness in golf. The PGA Tour even has a traveling gym. We have come a long way from when I had to go to the local YMCA.’
Mindset. Attitudes. Changing the way people think. Player was a visionary. And it showed in his longevity and success.
Take some risk and you might see the rewards
But why all this talk about golf? Well, the ups and downs on a golf course are exactly the same as investing in the stock market. Furthermore, when I see Yao Ming stand next to Player, I can’t help but think of the benefits of small versus big on the course, too.
I see a 7’6” giant, full of strength and size, but, on a golf course, he’s inefficient and frankly pretty terrible.
Whereas Player, at 5’6’, minuscule by comparison (and at 80 years), is still full of talent, strength, skill and tremendous success.
The golf course is the stock market. Player is proof that the best come in small packages. Ming is proof that bigger isn’t always better. It’s exactly the same as small cap stocks versus large cap stocks.
The chart below is the one-year performance of the S&P/ASX Small Ordinaries Index against the S&P/ASX 100.
Source: Google Finance
Click to enlarge
The blue line is the Small Ords — the ‘Gary Player’. The red one is the ASX 100 — the ‘Yao Ming’. It’s pretty clear that small ordinaries over the last year have made large cap stocks look about as good as Yao Ming’s golf game.
Meanwhile, those who’ve had the courage to go for that birdie — to go for glory — have reaped the success and rewards. You can take a lot of investing lessons from the way you would approach a humble game of golf.
If you’re prepared to back the little guy, take on some risk, and have a go at something that might perhaps be a little unfamiliar to you, it can pay off in bucket loads.
Both golf and markets are certainly no slam-dunks. It can be frustrating and difficult, and sometimes things won’t work out. But you only need just one streak of incredible success; that one hole, that one stock that clears away the losses and makes it all that more exciting and worthwhile.
Editor, Money Morning
PS: Tomorrow, our biennial Port Phillip Publishing conference kicks off in Port Douglas. I’ll be up there with some of the best financial minds in the world. The like of Jim Rickards, Jim Rogers, Satyajit Das and Dan Denning will all be in attendance.
It’s going to be an incredible conference. If you were unable to secure one of our 650 places that sold out in a heartbeat, do not despair. We’ll be recording the whole thing and providing digital access. If you’re interested in securing your own copy of the event, just follow the link here.
Also, if you are in attendance, we’re running a brilliant promotion where we’ll be giving away three 1oz Silver Coins. Check it out here.